Infrastructure costs to be borne by PINA and bank

JAKARTA. Banking industry would face new competitor in infrastructure projects. The scheme of PINA (non-state budget investment financing) allows the entrepreneurs, the financial institutions, as well as the financial managements to involve in infrastructure projects.

Under the scheme of PINA, the government offers three alternatives for the stakeholders to involve in non-state budget infrastructure projects. First, the Greefield system. Under this system, the entrepreneur can act as the funder and the project manager.

Second, the Brownfield system, which allows the project manager to invite new investors to be the project manager, as well as the funders by issuing bonds or credits. They also can target for the new projects under the scheme of PINA. Third, the Operation system, which allows the project manager to divest the project and to search for the new project.

Banks estimate that PINA scheme has brought opportunities to expand the infrastructure credits. “Infrastructure project requires a huge amount of funds. It is impossible that the costs are merely covered by the banks,” said Dikdik Yustandi, Corporate VP of Bank Mandiri.

Based on the 2015-2019 National Medium Term Development Plan, the infrastructure projects will cost as much as Rp 4,796.2 trillion of funds. Therefore, the banks still have a large potential to allocate credits in infrastructure projects.

Bank Mandiri is targeting to grow the infrastructure credits by 40% in 2017. Last year, the outstanding of infrastructure credits grew by 38.2% to Rp 57.3 trillion. During that period, most of the credits as much as Rp 22.6 trillion were allocated to the electricity sector.

Director of Banking Business I of Bank Negara Indonesia (BNI) Herry Sidharta added, the needs of investment funding for infrastructure remain high. Therefore, the opportunities to allocate credits to infrastructure sector remain high. “We are targeting all infrastructure projects, which need for funding,” he said, Tuesday (21/2).

BNI is targeting to grow infrastructure credit by 30%-40% from Rp 67.76 trillion at the end of 2016 to the range of Rp 90 trillion-Rp 100 trillion in 2017. The infrastructure has contributed to 35% of the total credit allocations of BNI.

Director of Wholesale Banking of Bank Permata Anita Siswandi said, despite of the tight competition in credit allocations, the opportunities to allocate credits for the infrastructure supporting sectors, such as for the contractors, remain high.

Bank Permata is targeting to grow the corporate credit by 10% in this year, mainly to infrastructure, food and beverages, consumption goods, and automotive sectors. By the end of 2016, the corporate credit reached about Rp 50 trillion. (Muhammad Farid/Translator)